Can anyone think of a good hands-on activity I can have a group of NEW RT students do to illustrate the topic of EMPHYSEMA?

Well you could have them exhale and then quickly and very tightly wrap duct tape around their lower rib cage such that the diaphragm can't expand, forcing them to use mostly their accessory muscles. And maybe at the same time have them breath through a negative impedance device (Google "Power Lung" for commercial device used for divers and elite athletes).

But I sense a potential lawsuit should anything go awry.

One could also just manually hold lower rib cage and have them breath with noseclips and through very small mouth opening (pucker up and breath only through that). But that could lead to a sexual harassment lawsuit.

Good luck.